The Future CX: How Generative AI is reshaping SAP Commerce Cloud

Written by Nikhil Joshi | Jul 12, 2024 1:07:27 PM

A highlight of SAP Sapphire 2024, Generative AI is increasingly transforming the CX solution landscape across industries. Following ChatGPT’s exceptional success, companies are investigating how to integrate the technology to remain competitive and relevant in the market.

One thing has become clear as day: Generative AI, which was thought to be a temporary hype by some, is here to stay and its influence will only grow and steer the future developments in CX and beyond.

In a recent Gartner webinar poll of more than 2,500 executives, 38% indicated that customer experience and retention is the primary purpose of their generative AI investments. This was followed by revenue growth (26%), cost optimization (17%) and business continuity (7%).

In this blog, our expert Nikhil Joshi outlines his understanding of SAP’s vision and current developments in the Generative AI sphere, and what these could mean for business leaders in the CX space.

Current Applications of Generative AI in SAP Commerce Cloud

SAP promotes a Build in, Not Bolt on approach. This implies that SAP integrates AI capabilities into apps and extensions. In SAP’s own words:

Unlike other generative AI technologies that only utilize the data found in one siloed system, these new AI capabilities leverage SAP’s wealth of experiential and operational data, as well as data from third-party sources, to provide businesses with a holistic view of their customers. Proactive, contextual, AI-powered insights from across the enterprise help organizations optimize business processes and adapt to unique business needs and rapid changes in the market.

SAP’s AI Toolkit is “a set of AI capabilities to automate time-consuming tasks and quickly analyze data from across the enterprise.” The user can access these capabilities everywhere through a standalone app and Joule.

Benefits of Generative AI in SAP Commerce Cloud

Combining your SAP business data with proprietary AI models and fine-tuned large language models (LLMs) can deliver exceptional experiences. For SAP Commerce Cloud users the most impactful use case of Generative AI is in catalog management and product discovery. With Generative AI, SAP Commerce Cloud users can:

Provide personalized recommendations by analyzing customer behavior and preferences.
Create tailored content like product descriptions and promotional offers based on images, tags, and attributes.
Improve search and product recommendations by extracting and refining product tags with image and text-based attributes.
Use chatbots to handle common customer inquiries and issues.
Enhance product discoverability with visual search capabilities for customers.
Predict demand patterns, help optimize inventory levels, reduce stockouts, and improve supply chain efficiency.
Predict customer churn.
Create and implement targeted advertising campaigns.
Create and personalize email marketing campaigns.

SAP Joule

Designed to work within the SAP ecosystem, including Commerce Cloud, SAP Joule —a cutting-edge generative AI assistant —simplifies tasks and provides intelligent insights.

Functionalities of SAP Joule

Natural Language Processing: Joule understands plain language queries. Ask questions about your data in SAP applications and receive clear, informative answers without needing complex queries. It reduces the average search time across applications by up to 80%.

Contextual Awareness: Joule retains context throughout the user’s interaction. The user doesn’t need to repeat their information. Joule can understand and follow up on a previous question.

Task Automation: Joule can automate repetitive tasks within SAP applications.

Personalized Experience: Joule customizes the user experience based on the SAP user’s role and activity. It can suggest relevant actions or next steps suited to the user’s specific needs.

Data Security: A core focus for Joule is data privacy and security. It adheres to strict protocols to ensure the user’s data is handled safely and compliantly.

SAP Joule is still under development and being rolled out in phases.

Generative AI in SAP Commerce Cloud: Developments on the Horizon

Three prominent developments have emerged in the Generative AI space that are either already having or will have a deep impact in the future.

Conversational systems

Generative AI systems now are increasingly understanding question context. The user can ask questions in plain English. The AI can generate clear and concise textual responses.

Automation

Generative AI can analyze SAP data and automatically generate reports, saving time and ensuring consistency.

Simulation

AI can create simulations of different business scenarios using SAP data. For instance, the users can simulate the impact of a new marketing campaign or a potential supply chain disruption, allowing them to test strategies and make informed decisions before committing resources.

Future Applications Of Generative AI in SAP Commerce Cloud

SAP’s vision for Generative AI includes using AI to:

Deliver exceptional customer experiences
Help companies differentiate their business
Create brand loyalty
Reinforce customer relationships
Drive profitability

For 2024 and beyond, SAP is exploring multiple use cases for Generative AI which might be applicable to Commerce Cloud as well. The new developments include “AI-supported business simulations, AI-generated business correspondence replies and follow-up actions, composable business processes, or automated generation of code.”

Other prominent developments on the horizon are:

Hyper-personalization: hyper-personalized shopping experiences, using real-time data and customer context.
Virtual try-ons and customization: Ability to customize and virtually try-on products under different surroundings.
360-Degree Customer View: integrating data from multiple touchpoints to create comprehensive customer profiles indicating their behavior and preferences.
Sentiment Analysis: analyzing customer reviews and social media interactions to know sentiment to build marketing strategies and product features.
Optimized Product Listings: generating high-quality descriptions, selecting the best images, and recommending optimal pricing strategies.
Inventory Management: predicting inventory needs and optimizing restocking schedules.
Product Descriptions and Reviews: generating product descriptions and customer reviews, ensuring they are SEO-friendly and customized to different customer segments.
Visual Content Creation: creating visual content, such as banners and social media posts.
Voice-Activated Shopping: allowing customers to interact using voice commands.
Eco-Friendly Recommendations: highlighting eco-friendly products and practices.
Augmented Reality (AR) and Virtual Reality (VR): providing immersive shopping experiences, such as virtual showrooms and interactive product demonstrations.

With Generative AI’s capabilities backing the CX evolution, possibilities are immense and we’ve only begun to see the budding offshoots of what we believe will grow to be an enormous Sequoia in times to come.

Connect with our Commerce Cloud experts to discuss Generative AI’s potential in your organization.

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